Two-Factor Authentication Could Stem Rising Tide of Identity Theft

Washington panelists tout the value of the small, digital token devices that provide users with a random, six-digit code that changes every 60 seconds.

Two-factor authentication may well be the key to stemming the onslaught of identity theft now plaguing businesses and consumersif you can talk customers into using it, that is.

"It's easy to apply two-factor authentication when you have employees [or a government mandate]," said John Carlson, senior director of BITS, a nonprofit organization of financial institutions that focuses on technology and business issues. "But it's a highly different equation when you deal with customers that can choose between different financial institutions."

Carlson was part of a panel of vendor, government and business data security experts who convened Friday in Washington at the Center for Strategic and International Studies.

The panel, "Emerging ID Theft Challenges in Cyber-Space: A Discussion of Possible Technology and Policy Solutions," also included Howard Schmidt, former special adviser to the president for cyber-space security; James Lewis, of the Technology Policy Program at the Center for Strategic and International Studies; Joe Raymond, chief architect of Web optimization at E-Trade Financial Corp.; and Art Coviello, president and CEO of RSA Security Inc.